Canopy Growth Corporation (TSX:WEED) (NASDAQ:CGC) announced its financial results on Thursday for the fourth quarter and fiscal year ended March 31, 2024.
Fourth quarter net revenue for the company's subsidiary Storz & Bickel which manufactures high-end and medically certified cannabis vaporizers surged 43% year-over-year to CA$22million ($16 million).
Canada’s cannabis net revenue in the same period increased 4% year-over-year led by a 16% increase in the Canada medical cannabis business that saw its 5th consecutive quarter of revenue growth.
Canopy CEO David Klein said the company made "remarkable progress and delivered dramatic reductions in expenses, cash burn, and debt over the past year," which is expected to result in "achieving positive Consolidated Adjusted EBITDA."
Canopy will seize positive cannabis regulatory shifts in Germany and the United States, Klein added. "Entering FY2025, Canopy has growing businesses in all of the world’s most attractive cannabis markets, a leading portfolio of high-impact brands, and a rapidly developing U.S. ecosystem.”
See also: Canopy Growth Expands U.S. Reach By Acquiring These Two Key Cannabis Brands
Q4 2024 Financial Highlights
- Net revenue totaled CA$72.8 million, up from CA$68.2 million in the same quarter of 2023.
- International markets cannabis net revenue increased 32% year-over-year to CA$12 million driven by growth in Germany and Poland as well as the timing of revenue from the US CBD business which is non-recurring.
- International markets cannabis gross margins improved by 5000 bps to 54% driven primarily by change in geographic mix and impact from non-recurring revenue from the US CBD business.
- Consolidated gross margins improved to 21% due to cost reduction activities, as well as lower excess and obsolete inventory charges in Canada cannabis.
- Selling, general and administrative expenses declined 23% year-over-year to CA$54.6 million, primarily due to cost reduction programs undertaken to date.
- Cash outflow from operations improved 77% year-over-year driven by cost reduction programs and reduction in interest payments.
- Operating loss from continuing operations of CA$107 million, representing an improvement of 80% year-over-year.
- Net loss attributable to Canopy totaled CA$92.3 million, compared to CA$640 million in the prior year's period.
- Adjusted EBITDA, a non-GAAP measure – came in negative at CA$15 million, compared to an adjusted EBITDA loss of CA$40.4 million in the fourth quarter of fiscal 2023, representing a 63% year-over-year improvement.
As yet another earnings reporting season wraps up, it is important to understand what these figures mean for the future of the industry. Hear directly for top executives, investors and policymakers at the 19th Benzinga Cannabis Capital Conference, coming to Chicago this Oct. 8-9. Get your tickets now before prices surge by following this link.
FY 2024 Financial Highlights
- Net revenue totaled CA$297.1 million, down from CA$333.2 million in fiscal 2023.
- Canada medical cannabis net revenue increased 10% year-over-year to CA$61 million, driven by customer mix and a larger assortment of products in the Spectrum Therapeutics online store.
- International markets cannabis net revenue increased 6% year-over-year to CA$41 million primarily attributable to growth in Australia. International markets cannabis gross margins improved to 40% primarily due to a positive shift in geographic mix.
- The total cost of goods sold decreased by 45% in fiscal 2024 and Canada’s cannabis COGS decreased by 54% year-over-year, driven by the cost reduction actions.
- Consolidated gross margins increased to 27%, an improvement of 4,600 basis points year-over-year, with Canadacannabis, international markets cannabis and Storz & Bickel all posting higher gross margins year-over-year.
- Canada’s cannabis segment gross margins improved to 16% in fiscal 2024 driven by lower excess and obsolete inventory charges and lower operating costs.
- Selling, general and administrative expenses declined by 33% year-over-year primarily driven by cost reduction actions executed in the first half of fiscal 2024.
- Adjusted EBITDA, a non-GAAP measure – came in negative at roughly CA$59 million, compared to an adjusted EBITDA loss of CA$208.6 million in fiscal 2023, representing an improvement of 72% year-over-year
- Operating loss from continuing operations of CA$229 million.
- Cash, cash equivalents, and short-term investments of CA$203 million on March 31, 2024.
CGC Price Action
Canopy's shares traded 0.24% higher at $8.5 per share during the pre-market session on Thursday morning.
Now read: Canopy Growth Announces Financing Deal Including Roughly $50M Of New Gross Proceeds
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